Justice Department Has Beady Eye on Google's ITA Acquisition

Back in July Google said it was buying airline travel software giant ITA. Now the Justice Department is probing the deal, concerned Google's might will put the squeeze on the industry.

The ITA deal had been rumored for a while before Google's official announcement in July. The $700 million transaction made sense—the two companies seem made for each other, it would give Google an inside line on some very neat real-time airline data, and the firm could even use its Net-searching expertise to make the task of finding cheap flights much easier for the average Joe Consumer.

But now the Justice Department is in the early stages of a probe into the deal, according to reports. The concern is whether Google's acquisition of ITA would strangle a data feed that other existing players in the online flight sales market rely upon. ITA, for example, sold the data that makes Orbitz and CheapTickets work. Will the way Google treats ITA cut this feed off, or will Google (by hook or sneaky crook) merely upstage these companies and steer flight-seeking consumers to its own offering? According to Google, it doesn't compete with ITA, so no antitrust issues should emerge ... but Google seems to have forgotten its sheer might, and the fact that if it enters into a market it's not already "competing" with it can severely skew the business.

Meanwhile Google's facing its first big antitrust lawsuit in the U.S., emerging from allegations it "manipulated" myTriggers, SourceTool/TradeComet, and Foundem's rankings in its search results. Microsoft is also allegedly interested in a lawsuit based on the same matter. Texas Attorney General Greg Abbot is apparently the first regulator to dig deep into the details of Google's search business wheeling-and-dealing. This is bad PR juju for Google, because though it wants to pretend otherwise, it's really all about Internet searching—this is the cash cow at the heart of its business.